?
In Figure 5-16, a decrease in the price of apples will
A. shift Adam’s budget constraint out.
B. make Adam’s budget constraint steeper.
C. shift Adam’s indifference curves out.
D. make Adam’s budget constraint flatter.
Answer: B
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Refer to Figure 27-12. An increase in government purchases of $200 billion causes aggregate demand to shift ultimately from AD1 to AD2
Assuming a constant price level, the difference in real GDP between point A and point B will be ________ $200 billion. A) less than B) equal to C) greater than D) There is insufficient information given here to draw a conclusion.
Suppose there are 11 buyers and 11 sellers, each willing to buy or sell one unit of a good, with values {$14, $13, $12, $11, $10, $9, $8, $7, $6, $5, $4,}. Assume no transaction costs and a competitive market. If there is a market maker in this market. What is the profit maximizing bid-ask spread per unit for a market maker?
a. $6 bid; $12 ask b. $7 bid; $11 ask c. $8 bid; $10 ask d. $9 bid; $9 ask
The prisoners' dilemma is used to illustrate the basic idea that
a. oligopolistic firms would be better off if they collude, but each has an incentive to cheat on the collusive agreement. b. oligopolistic firms are always worse off when they collude. c. oligopolistic firms never have an incentive to cheat on collusive agreements, unlike prisoners. d. students who cheat on economics exams end up in jail.
Which shifts the aggregate demand to the right?
A. Increase in government purchases B. Reduction in consumer spending. C. The selling of government securities by Fed Reserve Bank D. Downsizing of corporate investment spending